Once a Survivor, Always a Survivor: Richard Hatch Speaks Out on Taxes, IRS

On the first season of CBS' Survivor, Richard Hatch was quickly painted as the villain. He was, to many viewers, too cocky and too focused on winning. Despite his less than favorable reputation, Hatch went on to become the first ever Survivor winner.

More than ten years later, Hatch has found out what it means to be the victim of a "win at all costs" strategy. Since 2005, he's been battling with the IRS over charges of tax evasion; he would eventually spend 51 months in federal prison after being convicted on two of those charges. His very public fight became fodder for cocktail parties and water cooler conversations - and provided page after page of snarky commentary for bloggers like me.

That was a good start. I asked Hatch how he found out he was under investigation from IRS. He explained that after he won on Survivor, he deposited the entire $1,000,000 in his local bank - no offshore accounts, no attempt to hide the money. There had been no withholding from his check from US or Malaysian tax authorities despite the fact that he understood, per his contract, that taxes were required to be paid when he left the island in 2000.

Hatch admitted that he didn't file on Tax Day. His accountant filed for an extension while they took some time to figure out the next steps. He was, he said, in communication with IRS during this time. Eventually, he received a notice from the IRS but the million was not mentioned.

Two years later, he was indicted for willful evasion and was advised to take a plea. He didn't. The charges were dropped. Eight months later, Hatch was charged with ten criminal counts, including tax evasion. If convicted on all charges, Hatch faced up to 47 years in prison. Still, Hatch refused to take a plea. Instead, he rolled the dice and went to trial.

Unlike his stint on Survivor, this move didn't prove to be a strategic one. At trial, Hatch was acquitted of eight counts and found guilty of two counts of "attempting to evade taxes" and one count of "filing a false tax return" relating to his 2000 and 2001 returns.

He appealed the sentence in 2006, claiming, as part of his appeal, that CBS agreed to pay the tax. CBS has denied those claims through the press but those charges were never aired in court. The judge didn't allow them on procedural grounds.

I asked why Hatch didn't sue CBS for the tax directly. He reminded me that he had representation this whole time, as did CBS. And, he pointed out, he still had a good relationship with the network: he had been invited back for Survivor All Stars in 2004 (he participated) and Survivor's 20th reunion in 2009 (he wasn't allowed to travel because of his house arrest).

Hatch spent several years in federal prison before being released in 2009. He was sent back to prison at that time for not amending his 2000 and 2001 tax returns, as ordered by the judge. Hatch said that he was told that he could not amend them because of the ongoing investigation. He's right. Once a criminal investigation has begun, a taxpayer may not attempt to fix the problem by filing old or amended returns or by paying the tax due. After he served additional time, the requirement that he file an amended return was eventually dropped.

Shortly after his release, he granted a media interview to NBC and was arrested for violating prison media-access rules. Hatch says that his attorney got permission in writing, as did NBC. Nonetheless, the next day, he was shackled and sent back to prison, this time serving solitary confinement. The reason? The Bureau of Prisons has argued that the permission was for one interviewer, not three. Hatch served the time but has challenged the ruling, alleging that the permission allowed him to be interviewed by NBC, not a specific interviewer. It's a distinction that matters to him after all that he has been through.

Hatch has another attorney now and is trying to figure out his next steps. He says that he still doesn't have a fixed amount due from IRS. That two million dollars that I referred to in my last post? Hatch says there's no assessment for that amount. He claims that number was part of a court discussion between the judge and the prosecutors. The IRS, however, has sent him no final bill. They have, however, liened his sister's properties. They've also held onto his passport, which they've had since 2005, even though Hatch has not been declared a flight risk.

He knows that he owes something but he doesn't know how much - or even how to figure it. For now, he's been ordered to pay 25% of any income for the next 26 months towards his tax obligation. That's been a struggle since his notoriety has not necessarily been for the right reasons. He says he just wants to put all of this behind him.

I wondered whether his reputation as a villain had influenced both how he was treated by IRS and by the press. Hatch said there was no question. He says, about the IRS and the prosecutors: